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The challenges facing todays global manufacturing ecosystem are not the same as those 50, 25, or even 5 years ago. Companies now have to learn to integrate systems across the globe and provide support for operations that run 24 hours a day, 7 days a week, and 365 days a year.

We used to schedule downtime during a holiday, but a holiday in the United States may not necessarily be a holiday in another country. New York used to be the city that never sleeps, but we are quickly becoming the networked world that never sleeps.

These international operations require manufacturing intelligence data at the fingertips of those who need to make management and logistic decisions. The manufacturing market challenges that companies face now include globalization, labor issues, competitiveness, and cost pressures.

Companies are finding that they need to improve their business practices with new strategies that support these challenges in order to survive and flourish. Scheduling is only one part of managing global operations.

Companies can improve consistency and predictability by improving their quality management practices both internally and in the supply chain. It is simply not enough to manage quality inside the production walls as it is much harder to respond to poor quality issues arising from components or sub assemblies if the supplier is the only one who can fix any issues that might arise.

Standard practices and metrics for manufacturing management are also critical to synchronizing global operations. To achieve this goal, it helps to standardize manufacturing and quality systems across the enterprise, and define standard integration interfaces between suppliers and internal operations.

Standard reports and a central data repository are also important so that everyone is working off one single version of truth. However, implementing standard processes, global systems, and a central repository is often easier said than done. Challenges include different languages, time zones, and security issues across the Internet.

Here are some lessons learned from big corporations deploying MES, or Manufacturing Execution Systems, and QA, Quality Assurance, systems around the world.
It is important to design interfaces between global systems so they can accommodate downtime. Systems should minimize impact to manufacturing operations during maintenance periods and must prevent data loss during these downtime periods. Offline methods should be able to recover connectivity and synchronize after any part of the enterprise system was down.

The corporation should define realistic performance expectations for systems prior to implementation. For example, are there any preexisting WAN capacity limitations that might hold performance back? Are there any elements that cannot be controlled or standardized, like suppliers hardware that could affect the use of an application? Have suppliers tried to minimize any security risks or problems with Internet connectivity?

Are there security measures in place that conform to industry practices and regulatory oversight, like those imposed by ITAR? These are all important questions to ask before beginning the process.

Companies should also keep in mind that the manufacturing systems should be continuously available to the shop floor when deciding whether to implement a system in a central or a distributed manner. They should figure the cost of one hour of production downtime to help make decisions on high availability platforms, and should have well documented service restoration procedures in place in the event of any problems or glitches.

The coverage plans should include a call list of key people that will be available round the clock so that the company does not have to solely rely on first shift support to fix problems. Potential language challenges should be taken into consideration when making the call list as well. Scheduled maintenance windows should be clearly communicated across the enterprise.

Companies should carefully consider data warehousing and business intelligence solutions that will be part of the enterprise system. Considerations should not only include user friendliness, but also performance and security requirements. Regions like China and Eastern Europe might require isolated networks.

If companies consider these issues upfront and design their systems to accommodate these requirements, they will be off to a good start. There are companies out there that have already embarked on these efforts and some are willing to share the lessons they have learned.

There are also system integrator companies that are specializing on global solution deployments. Companies should be sure to reach out and leverage the experience of those paving the way in this new global manufacturing ecosystem.

iBASEt is a leading provider of high tech software solutions and services. More information about this topic and Manufacturing Execution Systems is available in the webcast entitled Tying Engineering, Quality and Operations into One Global Quality Management System.

Throwing a party can be tough at the best of times, let alone trying to accommodate the needs, desires and wants of colleagues and business associates. The best thing to do is pass the buck to a dedicated hospitality team to put together a package that meets all your requirements. Popular hospitality events include dinners with guest speakers, casino nights, theatre, fashion and flower shows, performing arts, concerts and a whole host of sporting events.

Although the monetary cost of a corporate event may seem enormous, the benefit of having the weight taken off your shoulders by hospitality professionals is priceless. Not only do you get to focus on the play instead of the work, you can be reassured that all the guests and colleagues will be adequately catered for and all their needs met. Events such as these can be fantastic team building exercises, as well as a relaxed way to meet new clients and promote business. So, how do you choose what type of corporate hospitality event will suit your company?

As the range of events available to attend is enormous, it is wise to see what packages are associated with certain events. If a champagne lunch is a priority, it’s no good booking a tank driving day. Maybe location is an importance, or the interests of your team or clientele you wish to entertain. Prestigious venues always have a big impact, and with VIP treatment for all, it will definitely leave a positive impression whichever hospitality package is chosen.

So, what can be expected from a typical package? The usual fare is champagne and food with souvenir memorabilia and event documentation, and there should always be a member of event management to hand to make sure the day runs smoothly. At the end of the day, your comfort and pleasure is their priority, so they are there to sort everything out on your behalf, so you can get on with quaffing the champers and savouring the soiree.

Sporting events are the most numerous on offer covering days at the races, whether that be horses or cars; rowing or the dogs. Major events are always open to hospitality functions, such as Formula 1 at Silverstone or rugby at Twickenham. If cricket is your bag, then a day spent at The Brit Oval might be of interest. You can expect to get a champagne reception, private seating, lunch with a complementary bar, event documentation and a celebrity guest speaker at dinner, and not to forget unrivalled views of match action. There is a choice between using the recently built stand with a roof terrace or the traditional pavilion to witness some of the most prestigious cricket matches.

If a little bit more action is what you are after, then a music event will gain you and your guests VIP entry to exclusive entertainment areas both pre and after show. As usual, expect champagne and a complementary bar as well as a three course meal and surprise souvenirs to take home. Or maybe a trip to see Cirque du Soleil at the Royal Albert Hall, for some unique circus entertainment; where a private box will be provided along with personal waiting services, food and champagne.

If the budget allows, you could always opt for a bespoke package and throw a party that is like no other. This is ideal for entertaining and impressing major clients with a clout, a unique night that is guaranteed to impress. And leaving the arrangements of the finer details to the professionals will guarantee that the only headache you’ll have will be from the champagne the morning after.

Shaun Parker is an expert in corporate entertainment and recommends The Oval Corporate Hospitality. To find out more about corporate entertainment visit the Keith Prowse website.

Getting in front of the right person is crucial to the success of any construction related business. The beginning and end of marketing for construction is found in “building the right relationships”.

So here is the scenario we have all encountered:
You are facing an impenetrable fortress. There are guards on the main entrance and you cannot get through without a secret password which is changed on a regular basis. The person you want to see is on the other side of the reinforced wall and is rarely seen in public!

What does this remind you of? Yes, right! It’s that BIG PERSON who makes the decisions about who gets on the tender list who is sitting at a big desk behind the wall. How do you get through? Perhaps the question to ask before you even reach the wall is: “Who do I call?” “Who is the decision maker?” “How do I find out the right person to speak to?”

It goes without saying that even trying to penetrate this wall is crazy without adequate research and preparation. Checking out the company website may reveal all, often giving a list of directors and management personnel along with their job titles. You may even get an email address or a direct phone line number, although that would be unlikely in the larger corporations. In a larger organization it may not be immediately apparent who is the decision maker dealing with your construction sector.

So where do you start?

I have found that once you start to dig, you can uncover the identity of the person you need to speak to even if it takes a few phone calls. This is where keeping notes on all your calls is essential. You can easily build a company profile and structure chart and it’s often the first person you speak to i.e., the person on reception who will help you.

There are a few obvious things to understand before progressing to your final objective:

1. Large companies and corporations are made up of smaller, autonomous units with their own staff structure and management responsibilities and once you have established the key pecking order in one, it will be easier to uncover the next.

2. The ‘gate keeper’, the person who answers the phone, has been briefed to screen all calls coming in and may not mean to sound aggressive and unresponsive.

3. Unless you have something specific to say, don’t bother to call.

4. Don’t be disheartened if you get a negative reaction on the phone. If you work with telesales often, you will need to have a thick skin in order to cope on occasions. Remember, don’t take it personally, unless you’ve gone out of your way to be discourteous, in which case, you deserve it!

If you are having difficulty tracking down the right person to speak to about a particular project, here are a few approaches that have worked for me:

1. As soon as the phone answers, say, “Hi! I have a question about doing business with your company. Can I ask you?” A surprised receptionist almost always agrees. Then say, “I want to send a short letter that introduces my company. Would that be okay?” The receptionist generally says this will be OK. You now
have two ‘yes’ answers! Finally say, “If I explain what we do, would you tell me who to address the letter to?” The response is almost always positive and you will get the persons name you need to contact.

2. If you are having difficulty finding out the right person to contact, often the Human Resources Department of major companies will help you out.

3. Another avenue would be to look at the Company’s Annual Report which you find on a Google search on the internet. You will find key people listed and by contacting one of them, can usually find the right person.

4. A good way to build your database of important contacts would be through the trade press. Get names of people being interviewed in feature articles and check out who is writing about whom.

5. If you run high quality seminars on subjects of
interest to the professionals you would like to work with, ‘Continuous Professional Development’ events, this is a great way of meeting people and providing them with a service. Kudos for your company and great networking for all involved.

6. If you get to speak to a lower mortal in the organization, mention their name when calling the Big Guns! “I’ve just been speaking to Chris in your HR department and he said I should talk to you about…”

7. Sometimes talking to the Finance Director of a company and offering to save the company money, can get you a direct link with the top person.

Most importantly, don’t give up! If you are polite, but persistent, you can normally reach the right person! It is hard work and a little discouraging at times, but once you have cracked it, it’s worth it!

Steve Flashman is a Marketing Consultant with a unique edge! He is a public speaker published author, recording artist, media broadcaster and communications expert.
Marketing For Construction

Getting our marketing strategy right for our construction business is more crucial than ever in this time of economic uncertainty. The impact of the housing crisis in the UK and the USA is affecting not just the construction industry but home-owners and first time buyers, struggling to find the right mortgage.

Effective marketing for construction is based on our ability to build genuine relationships with our current clients and future prospects and this will involve face to face meetings.

Your aims at the first appointment are:

Firstly, to complete any knowledge gaps you have about your prospect and recording this in your customer relations database - if you haven’t got a database system, you are missing out on a vital tool in business development. There are a lot of CRM (Customer Relations Management) systems on the market which are specifically designed for the construction industry.

Secondly, to establish personal rapport and trust, your credibility along with your company credentials is something that your prospective new client will need to be comfortable with.

Thirdly, to learn about the prospect’s business, priorities, problems, trends and issues, and especially the corporate aims and objectives of the main decision-maker(s)

Fourthly, to understand the trading preferences of the prospect, Partnerships, Joint Ventures, Traditional Tenders, Negotiated Contracts, long term Frameworks etc

Fifthly, to find out more specific information about the project you are chasing and present the unique strategy your company would employ to win the contract and complete the work on time and on budget of course!

Sixthly, to agree a way forward that progresses the opportunity in a way that suits and helps the prospect, in whatever areas of support you can offer them.

The marketing person’s aim at this stage is absolutely not to launch into a full-blown presentation of the product/service features, advantages and benefits. Marketing people who do this will be listened to politely, ushered out and forgotten. (They’ll then wonder why the once attentive, interested prospect won’t return the marketing person’s phone calls, let alone agree to another meeting.)

It may be that the purpose of the meeting is to qualify your company in the eyes of the prospect for the job in hand, in which case you will need to have a full blown presentation to hand outlining the benefits of using your company.

MAKE SURE IT IS SPECIFIC TO THE JOB YOU ARE CHASING.

Your marketing person must be prepared to talk about the relevant technical aspects and benefits if asked, but typically this will not happen in major account situations, because the prospect will know that the marketing person is in no position yet to present a relevant solution or proposition of any kind.

Remember to give examples of other completed jobs of a similar nature and recount the benefits received by the client, obtain endorsements and references. It may be also that the marketing person is able to convey and interpret issues of legislation, health and safety, or technology that have potential implications for the prospect’s organisation.

Sustainability issues are HUGE in the construction industry at the moment and will continue to be so as government, both local and national, set out more and more stringent targets for the industry to reach on CO2 emissions, Green Construction and Modern Methods of Construction. If you can demonstrate low carbon emission projects which have been completed, you are on to a winner! If you can demonstrate zero carbon emission projects, you will rise to the top of the pack!

Onward and upward!

Steve Flashman is a Marketing Consultant with a unique edge! He is a public speaker published author, recording artist, media broadcaster and communications expert.
Marketing For Construction

There are two types of corporations in the United States. One is known as an S Corporation and the other is the C Corporation. Most corporations today fall under the C category. This category is not just for big businesses either. Small businesses can also be formed as a C Corporation. Usually a C Corporation has a lot of shareholders while an S Corporation does not. If you do decide to form a C Corporation you will be subject to paying a double tax on your profits but if you are the only shareholder or the other shareholders of the company are also employees you can avoid this.

First off you need to know how the double taxation system works. The government and the IRS consider C Corporations separate taxpaying entities. Just like you they have a number assigned to them like your social security number. A corporation is identified by its employer’s identification number or EIN. This number is used on all the tax documents you file and payments that are made to the IRS. As a C Corporation you business is responsible for paying a number of taxes. Payroll taxes are one and taxes on the profits of the business are another.

The double taxation system is very simple. At the end of the year when your accountant or tax professional is doing your tax returns the amount of taxes you owe will be calculated based on the profits your business earned for the year. That is your first tax. The second will be determined by the amount of the dividend you want to pay to the shareholders of the corporation. Assuming you are also a shareholder you will also get taxed on the dividend you are paid when you file your personal tax return on April 15th. That is how you are taxed twice on the same money.

If your corporation has only yourself as a shareholder or only a couple of shareholders that are also employees then there is a way to avoid being taxed twice. But the first thing you have to decide is what you intend to do with your profits. If you’re trying to grow the business and you plan on leaving your profits in the business to fund your growth then you will only have to pay the first tax. As you will not be receiving a dividend anyway you’ll only pay the tax on profits.

If you intend on putting your profits into your pockets then you’ll want to avoid the corporate tax on profits. There is a very simple way to do this. Pay yourself ad your shareholders a bonus at the end of the year. You should be able to at least estimate your profits. And using this estimate you can determine the amount of bonus money the company can pay to its employee shareholders. You of course will still have to pay taxes on this money but because you won’t be paying any taxes on your company’s profits you’ll be able to put that much more money in your pocket. Just make sure you write your bonus check before the end of the tax year.

Cash Miller is an experienced entrepreneur and speaker who has spent over a decade as a small business owner. His years of experience in small business cover a variety of topics. If you are looking for more small business help please check out http://www.smallbusinessdelivered.com

Hopefully, before selling a business, you meet with a CPA or tax accountant and get an estimate on how much of your proceeds will be going directly to Uncle Sam if you pay them in a lump sum at time of sale. You don’t want to save this surprise for after all is said and done, because not only will it most likely be a shock, but you will have given up your chance to do anything about it.

Planning is everything. For this article I will assume you are not doing a 1031 business exchange, that is selling your business and buying another similar business taking into consideration all the IRS guidelines and timelines. It’s pretty rare to see this, but it can defer all of your capital gains tax if done correctly. A 1031 Exchange is more commonly implemented with real estate.

Depending on how the business is sold, the gains may be taxed as long term capital gain, short term capital gain, ordinary income, etc. and if you are selling an asset in a C-Corp you may face double taxation. So, the idea is to minimize your tax bill and maximize your proceeds no matter what situation you are in.

One option is with a Self Directed Installment Sale. The structure must be in place before the buy/sell agreement is signed. The gist is to receive the sale proceeds in installments and only pay capital gains tax as you receive the income. This has the effect of allowing the majority of money you would have paid immediately in taxes to continue earning compounded interest for you for many years, thus increasing your bottom line by a significant amount.

The details are a bit too complex to fully outline in a short article, but both an LLC and a Trust are created for you and set up meet IRS criteria for favorable taxation of installment sales. Your asset gets transferred to the LLC prior to sale, and your buyer purchases from your LLC. The trust buys the shares of your LLC from you via an installment agreement and you pay taxes on your gain only as you receive the payments.

You, the seller, are able to control when the payments begin and how long they will be spread out. This allows for maximum flexibility to control your income, and plan for future tax savings as well. Since your buyer paid cash in exchange for your property, you are not dependent on them to make the installment payments and you have transferred the risk of refinance or default. This is done by using an independent third party administrator and your money is safely invested in a principle protected insurance product to be used solely for the purpose of paying the installments.

If you pass on before receiving all of the payments due, the remainder of the installment payments pass to the beneficiaries of your choice.

Seeing an example of a taxed sale vs. a Self Directed Installment Sale side by side will show you how much of a difference in overall return this strategy will provide. This can make the process of the sale more palatable and provide a dependable income stream for retirement.

The tax benefit of this approach is similar to your 401K or IRA account. You reduce your current income by the amount of your annual contribution and thus defer the tax you would have paid on that income amount. Those funds are invested in stocks and bonds and grow in value, sometimes dramatically, for the period before you retire and start taking distributions. When you start distributions, the amount is treated as ordinary income and you are taxed at your much lower (you are no longer working and earning a big salary) income tax rate at the time.

The Self Directed Installment Sale allows you to similarly defer your capital gains tax from the sale of your business. Instead of paying all of your capital gains at time of sale, you set up your SDIS to pay out your sale proceeds over time. If you pay all of your capital gains tax at time of sale, that money is gone forever. However, with this vehicle, you spread your receipt of the sales proceeds out over, 15 years for example. When you receive your distribution, you are then taxed for the portion of that distribution that is attributed to the capital gains - generally about 15%.

The difference in after tax proceeds are dramatic and are demonstrated by a complex analysis called an illustration. I will try in an abbreviated fashion, however, to demonstrate the potential impact. If you sold your business and you had a capital gain of $3.46 million, your lump sum capital gains tax payment at a 15% rate would be $519,000. In the SDIS you would keep the entire sale proceeds of $3.46 million and take distributions over a 20 year period or whatever period you chose. You receive an annual payment over 20 years, that would consist of 1/20 of the principal, 1/20 of the capital gains, plus investment returns.

If we did an illustration of this case and compared selling the business and paying all the capital gains up front and invested the remaining proceeds in a 6.85% compound growth portfolio versus the SDIS paying 1/20 of the capital gains annually, you would gain an $831,000 advantage in after tax proceeds. Not to bad for a little advanced planning.

Dave Kauppi
is the editor of The Exit Strategist Newsletter, a Merger and Acquisition Advisor and President of MidMarket Capital, representing owners in the sale of privately held businesses. We provide Wall Street style investment banking services to lower mid market companies at a size appropriate fee structure.